The Labor Shortage May Help Fix Hiring

The U.S. economy has regained all the jobs it lost during the pandemic. The last jobs report (January 2023) showed growth of 517,000 jobs and the lowest unemployment rate in over 50 years. Employers are having a hard time finding talent, and economists predict that they’ll have trouble for years.

Some employers are changing policies to make it easier to find qualified candidates. Many are foregoing drug testing, especially in states where marijuana has been legalized. They’re also eliminating credit checks (which were questionable as a screening tool anyway) and overlooking minor criminal histories. “Check the box” programs are giving applicants with felony records a chance to prove their qualifications entitle them to a second chance.

These are all steps designed to allow more people into the hiring pool, but there are still polices and common practices in HR that are keeping potential employees out of the running for jobs they could probably be successful in. Here are a couple of hiring practices that could be eliminated.

Requiring degrees for most entry-level office jobs.  There are hundreds of jobs that employers list as requiring college degrees, from accounting to administrative assistants and sales. Most college degrees don’t provide the specific skills these jobs require; students and current workers could get the training they need through vocational certificates or 2-year degrees. I’ve heard HR staff say that college degrees are a useful screening tool for finding candidates with persistence. Students who drop out of college without finishing were deemed to be less desirable.

But these days, they might just be the smart ones. Students are finding that their college loan debt is keeping them from being able to buy homes, start families, and start saving and investing. According to the Education Data Initiative, the average graduate leaves with $37,500 in student loan debt. The average private school graduate has over $50,000 in debt. Surveys also find that 20 years after entering school, half of the student borrowers still owe $20,000 each on outstanding loan balances.

These statistic aren’t surprising when we return to the fact that employers are requiring college degrees for jobs that pay entry-level wages. With the exception of a few high-paying professions (mostly technical), many new graduates don’t make enough to cover their student debt and an independent lifestyle. But they’re not able to forgo college since they won’t be considered for even entry level jobs without the obligatory degree. It’s a vicious cycle.

Ghosting applicants or treating them like commodities. Part of the problem is automation of the application process; applicant tracking systems are programmed to look for specific key words and will not be able to reason through unconventional experience that might count toward success in a role.

Automated reply systems send rejection notes without human intervention, and applicants can feel the difference. One applicant I talked to was applying for entry level jobs to keep busy and social. He had a long business history and was more than qualified for the positions he was considering in public-facing companies, but he was getting rejection letters without getting a chance to speak to anyone. “I assume it’s about my age,” he said (he’s over 60), “but I guess I’ll never know. Meanwhile the ‘We’re always hiring’ sign still sits in the window. I guess they’re always hiring – just not people like me.”

You know it’s a bad policy when it turns off applicants from the brand. But companies forget that applicants are also consumers; they may be losing business as well as talent.

I’ve experienced several recessions over my workforce and coaching career, and I’ve seen unemployment at record lows. During the boom times, companies insist that their employees are their most valuable asset. But they forget all that when the next economic downturn happens.  

Things may really change now that demographics are finally catching up to employers. When the baby boomers exit the workforce for good, there just won’t be as many workers to replace them. And the next generation of workers will have many more options than traditional jobs. From entrepreneurship to gig work to social media influencing, they’ll be able to craft a career that fits their needs.

Recruiters should take notice. Let’s fix hiring so traditional jobs look like an attractive option again.

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